House prices jump £10k in just a year as official figures show property on the up in every region of the UK

House prices increased by 2.9 per cent in the year to May 2013, up from a rate of 2.6 per cent the month before, official data showed today.

That means the average price for a UK property now sits at £239,000, according to the Office for National Statistics house price index. In December, this stood at £233,000 and in May last year, £229,000, highlighting the fast growth in the last 12 months.

Broken down into countries, England has seen property prices shoot up by 3.1 per cent, Northern Ireland by 1.9 per cent, Scotland 0.8 per cent and Wales 0.6 per cent.

Growth: House prices have been nudging up since the start of last year according to ONS figures

According to the ONS, May 2013 is the first month that Northern Ireland house prices have grown year-on-year since February 2008.

Average house prices in May 2013 stood at £248,000 in England, £134,000 in Northern Ireland, £180,000 in Scotland and £157,000 in Wales.

The ONS says the annual house price increases in England were driven by a whopping 6.6 per cent rise in London and a 2.7 per cent in the North West and the West Midlands.

If the figures excluded London and the South East, UK house prices increased by a smaller 1.9 per cent in the last year.

Regional growth: Every single region in Britain saw property values increase in the 12 months to May 2013

The ONS figures show that London has the highest average house price at £416,000, while the North East had the lowest average house price at £144,000.

HOUSE SALES SOAR TO FOUR YEAR HIGH

The average estate agency branch sold
ten properties in May – up from seven during the same month last year,
according to data from the National Association of Estate Agents.

This figure is a four year high, while the NAEA also said there has been a boost in the number of house hunters.

A typical branch had 313 registered would-be buyers on their books in May – up from 274 in the same month last year.

Mark
Hayward, managing director of the NAEA, said: ‘These really are
encouraging figures – serious house hunters are continuing to enter the
market and they are intent on buying.’

London, the South East and the East of England all recorded prices higher than the UK average price of £239,000.

Excluding London and the South East, the average UK house price is £189,000 - or £50,000 lower.

Ben Thompson, managing director of
the Legal & General Mortgage Club, said: ‘Once again the ONS data
suggests that UK house prices are continuing to rise this month. It’s
always great to see positive data concerning the housing market.

‘All
signs are that the recovery is gathering significant momentum.

'However,
it is important that we remember it’s still early days and although the
picture looks rather rosy in certain areas, such as London, recovery is
a slower process in other parts of the country.’

The
ONS index is calculated using mortgage financed transactions that are
collected via the Regulated Mortgage Survey by the Council of Mortgage
Lenders. The ONS rounds figures up to the nearest £1,000.

First-time buyer numbers continue to grow

According to LSL Property Services, some 9,600 more first-time buyers secured a mortgage in the first four months of this year than in 2012.

The average price for properties bought by a first-time buyer increased by 4.1 per cent over the year to May 2013 with the average price paid for a property being £181,000, the ONS figures have revealed today.

The graph below shows the boom in first-time buyers, especially in April and May:

The flurry of first-time buyers is being fuelled by the Government’s Funding for Lending scheme that offers banks cheap finance, and its Help To Buy initiative, which allows buyers to secure a new-build home up to the price of £600,000 with only a five per cent deposit.

David Newnes, director of LSL Property Services plc, said: ‘Funding for Lending and Help to Buy have played a critical role. There have been 7,000 reservations for Help to Buy over the past three months, and FLS has encouraged lenders to make mortgages more affordable and accessible for first-time buyers.

‘They’ve been like a steroid injection for the mortgage market. High LTV mortgage lending is 47 per cent higher than it was this time last year, and first-time buyer lending is up 42 per cent, which has led to a sharp boost in sales’.

Index echoes similar positive research in recent weeks

July has been a month full of house price growth in indexes. Halifax research showed house prices have rocketed almost £9,000 in just eight months.

Recent HMRC figures show that home sales in May were the highest in any month since March 2012 while Hometrack says prices rose at their strongest rate in almost six years last month rising across almost a third of the country.

Nationwide said house prices rose 1.9 per cent in June compared to a year earlier - pushing the average UK price to £168,941.

While members of the Royal Institution of Chartered Surveyors expect prices to go up 1.5 per cent over the next 12 months – at the start of the year, the prediction was for values to remain static.